Carvana Co. (CVNA) Earnings Call Transcript & Summary

Okay. Great. This was not for the list we're maintaining, -- so yes, thanks, Ernie Garcia, Co-Founder and CEO of Carvana, for being here. My name is Rajat Gupta, member of the automotive equity research team at JPMorgan. Thanks, everyone, for joining, and thanks, Ernie, again, for being here.

Yes, of course, excited to be here.

So yes, let's get right into it. You provided some fairly explicit long-term targets, 3 million units in 5 to 10 years, 20% to 40% volume CAGR, 13.5% EBITDA margins. You provided a very helpful visualization of how you get there, 90 to 80 weekly production additions. You have 23 IRCs today. Perhaps in 5 years, that average is like 40. So if you take the 180 per week addition, that's like adding 1% capacity every week to each IRC, if I did the math right. It doesn't seem like a crazy number. My question really is, if you're having this conversation a year from now, I'm hopefully you'll come and the number is, say, like 40 or 50 a week instead of 180, what would have gone wrong?

Yes. Okay. Cool. Well, I guess let me start with, I think the way that we've tried to think about these targets is I think 10 years is approximately doing what we're doing today for the next 10 years. And doing what we're doing today is defined in like absolute growth terms, not defined by like a constant growth rate. And so that feels operationally very achievable. And then I think you have like demand questions, which we can hit next if we want to hit demand questions. I think trying to do it in 5 years, would be pretty unique, like very few companies at our scale compounded 40% growth rate, which would be the average growth rate for 5 years, like once achieving this scale. So acknowledge that, that is, I think, like an ambitious target when viewed against history. But I think it's also pretty attainable when you break it down operationally. So the number that Rajat referenced was we've been growing for the last 12 months, we've been growing our production capacity by about 80 units per week on average over that period. During that period, we averaged 23 reconditioning facilities. By the end of this year, we expect to have around 35. And then by the time we've converted all of our mega sites, we expect to have around 60. If you do the math on what that implies for the last 12 months, if we've been increasing production by 80 units per week, and we've got 23 facilities, that's approximately 4 units of production growth per week per facility. At the end of this year, we'll be at 35. at that same rate, you'd be at 140 cars. And if you get to 60 when we open all the mega sites, you'd be at 240. In order to get to 3 million units in 5 years, you'd have to average 180 over that period. So I think like the fundamental building blocks are very clearly there. There's a lot of execution that separates you from where we are today to growing at that rate over a sustained period of time. So I think it will be hard, but it's certainly not impossible. And we think that given that we're about 1% of the market today and even that seemingly very ambitious goal would get us to 7.5% market share, which relative to most retail verticals would be pretty low penetration. We think that it's very achievable from like a global top-down perspective. And then I think the approximate story for demand over a long period of time has been that it has generally been there. We think that the offering that we make to customers is very desirable. It's a simple experience. It's economically very high-quality deal, and they feel confident afterwards and tell their friends. And so generally speaking, I think we've been getting continually better at providing the experience we provide to customers. I think the economics that we've given to customers have been pretty consistent across a long period of time. And I think from 2013 to 2021, that consistent experience and offering led to very fast growth. In '22 and '23, we had a massive strategic shift where we changed our focus, had to get to cash flow positive very quickly. And then in '24 and so far in '25, we've experienced again kind of very consistent growth, which we think is driven by that core offering. So we think demand should be there. We could also kind of defend that by looking at our cohorts and looking at our oldest markets and the market share that we've got there, which is much stronger than our average market share. And they're still growing quickly. And so I think we look at all that, and we think that it's up to us to execute well, but there's no reason we can't do it. So I think overall, we're pretty excited.

Are there any 1 or 2 things you would point out about Atlanta or some of the older cohorts that have performed like the metrics you mentioned on the earnings call. Atlanta growth was similar to the overall company from 1Q '22 to 1Q '25. Are there 1 or 2 areas or things you could point to that's allowed Atlanta to continue to grow at that pace? Is it just a simple word of mouth? Is it inventory pools, conversion? Like what's -- again, like just help us like get more comfortable with the demand side.

I mean, I think, generally speaking, I think the entire country benefits from changes to like experience quality. So things like faster delivery, more inventory pools, broader selection. Generally speaking, I think that's shared across the country. And I think, generally speaking, the growth that we've seen across the country is pretty similar. Of course, there's a variation across time. But the last time we gave detailed information on our cohorts was in, I believe, Q4 of '21. And at that time, Atlanta had a 3.5% market share, which would equate to approximately 1.4 million units per year at a 40 million unit per year average. And it was still growing quickly. And 95% of the markets that we had opened, which at that time was a couple of hundred markets, we were growing faster than Atlanta at the same point in its life. So I think the right mental model for the way that we've grown over time is that we've continually made the offering better. We've continually made enhancements to the website and growing inventory, and that increases conversion. And those are shared across markets. But another very important kind of driver of growth is that customers have to experience it and tell their friends that it's good. And that component happens locally. And I think that it's clear in the data that, that's an important component, which I think is like medium and long term good. Because if growth were driven just by your like national offering, then what you would see is you'd see as you open new markets, you would see them just jump to your market share that you enjoy in your older markets and they would instantly be at that level. And then you have to kind of like earn your increased market share beyond that. What we've continually seen is when you open a market, it ramps up monotonically in time, but it doesn't just jump to the higher market share. And I think that is because consumers in their mind, they're confronting a trade-off where they know that buying a car can be an experience that they're nervous about, and they know they're anxious about getting a bad deal and they want to go try something new. But they also are kind of like, I buy a car once every 6 or 7 years, I don't want to do anything dumb. And so sometimes the default can be do what everyone else has always done. And so I think consumers like sit there and have that battle in their mind when they're evaluating whether or not to go to Carvana. And I think as more and more of their friends and family buy a car from Carvana, it gets easier to say, okay, that's the way that I do it. But I think that plays out over time. And the time scales are actually long given the transaction cycle for buying a car is a 5- to 7-year transaction cycle, which is like another -- I'm going to just keep going on random handed here. But I think that's actually good. I think that people in e-commerce have developed a heuristic that they think is smart in many ways that faster transaction cycles are better. And I do think that condition on being able to observe the growth rate, I think a slower transaction cycle is actually better because you have more latent demand that's like on the come. If you have very, very rapid transaction cycles, you very quickly move to kind of the level of sales that your offering supports. If you have a very long transaction cycle, it takes time for those transactions to occur. And so you're always kind of behind the curve of consumer demand, which I think is like a net positive for us.

No I think that's a good way to put it. It's very clear. Then the other side of this equation, unlike a new car industry, you cannot manufacture used cars. To sell more used cars, you need to source more used cars. How do you help solve the supply side of the equation? I mean 3 million, again, it's a small number relative to the size of the market, but it's still a big number. No other retailer has done that under one hood. Is supply a challenge? Should we be worried about that either from consumers or from auction? Is it more localized? How do you solve for supply and that should not be a constraint to hit these targets?

So let me start with something that hopefully like provides a bit of credibility to then my very conceptual and very convenient answer that I'll ultimately provide. But I think the credibility is like if we go back in time 6 years and we listen to all the conference calls or listen to any of these conferences or whatever else, the question back then, we were approximately 1/6 of our current scale. And all of the questions were, will you be able to sell all your receivables at greater scale? Will you be able to source cars at similar margins? Those were all of the questions. And I think they're all good questions, and they all, I think, stem from this idea that if you want to take more of the market, like the incremental customer is more expensive in some way, maybe it's marketing dollars or acquiring the car or whatever it is, they're going to be more expensive in some way. But I think a mental model that I think has been more predictive so far of what's happened in our history, and we expect to be predicted in the future is there's already 40 million transactions that are occurring. And those 40 million transactions are ultimately just customers trading cars with other customers through the mechanism of many different dealers that all have very similar cost structures and profit goals. And so you have a very stable market that sort of provides like buttresses what your economics are going to be because many of these dealers cannot absorb losses. So as we grow, we may go to auction one day, let's say that's where we're going to buy our incremental car and raise our hand in a car that another dealer expects to ultimately be able to sell to a customer. And we may kind of argue about that car in the form of bids, but to the extent we do that intelligently. It's not just that one car that gets bid up, it's all the cars that get bid up, right, while we're arguing about that. Well, that means that everyone's like shared input cost just went up by the same amount. And everyone has the same underlying model and most dealers don't have the ability to take losses. So it's very likely that will be passed through. And then to the extent that we're right and we do sell the car next month, that other dealer that we were arguing about the car with is not going to raise their hand for that because they don't expect to sell it again next month. And so I think when you're in a mature market with mature unit economics and a bunch of players that have shared economics, if you can displace them in demand, your best expectation is that your economics for the incremental unit are the same as your economics in the previous unit. And I think that, that has played out over time. So whether we're talking about our ability to go sell finance receivables today, consumers are buying 40 million used cars. Many of them are financing those cars, and that is being financed through various channels. There are people that want to own receivables at that scale. To the extent we go take market share, the natural holders of finance receivables are going to come find us or we're going to find them, but we're going to find each other, one way or another. And I think the same is true of cars. So to me, I think as long as we execute the way that we would like to, I'm sure there will be little bumps, and we'll tell a bunch of stories along the way. But generally speaking, we should be displacing similar businesses that have similar economics, and we would expect our economics to be unimpacted at least in like a meaningful way.

Understood. Maybe on that supply side, how important is it getting access to or the first look to the lease returns as part of that 3 million target? I think on the earnings call, you mentioned you expect the business mix or inventory mix to look pretty similar, even at that 3 million. So that would imply lease cars probably is not that important, but just curious how you think about the off-lease supply supporting that 3 million target and maybe you want to touch on the franchise acquisition, if that's going to help eventually?

Yes. What I would say is, I think as a general matter, we want to have access to every channel of supply that exists and we want to try to structure our access to those supply channels in the most efficient ways we possibly can. I think that's part of what our marketplace offering has been, and I think that we'll continue to seek to find ways to take what we think is an advantaged retail channel paired with an advantaged wholesale channel to make us a great place for natural disposal of cars, whether that's consumers or rental car companies or off-lease or whatever else. So I think making sure that our system is as efficient as possible, disposing of cars makes us the best possible buyer, and that gives us access to all that volume. I think it's been -- there's only been one window in time that I can think of or I'm aware of where like off-lease volume was differentiated in its quality, and that was post-COVID when there was very rapid car price appreciation. And then therefore, those cars that were coming back off lease were extraordinarily valuable. And I think that, that was a boon to franchise dealers, and that was hard on independent dealers. But for the previous 25 years plus where I've been paying attention to automotive retail, generally speaking, those cars, we're still making through auction, you still had access to them. And it was more a function of just what was the quality of your retail disposition channel that kind of dictated how you get those cars. So I think we want access. We'll try to build creative solutions to those problems and make sure that we have access to lots of cars. But I don't think that there's anything particularly unique about lease. And then on the franchise dealer question, we'll just keep kind of like giving you the stiff arm. But one day, we'll definitely tell you something.

Understood. On the margin targets, it was interesting that you decided not to give a gross margin versus SG&A number, but more an EBITDA number. I'm curious, internally, how do you look at your economics, are you trying to solve for individual line items like retail GPU, finance GPU? Or are you looking at retail and finance as one bucket? Or you're just looking at EBITDA per unit as one bucket. I think -- help us think if the way you are looking at these metrics has changed internally for this company?

Let me give an example. I believe that when we went public in 2017, we were -- like we made one of our key metrics, total GPU, right? And we add it up across the transaction. And to a lot of people, I think that struck them as odd. But the rationale that we provided at the time, which is the same rationale that we'd stick with today is that like a consumer makes a single decision. The decision is I want to buy a car. When they want to buy a car, it is likely they are going to trade in a car. It is likely they're going to get financing for that car. And when they make their decision, they're going to have awareness of what they think they're trading should be worth. They're going to have awareness of what our rate should be and what a price should be ultimately, what drives their decision is going to be, okay, my monthly payment is going up by this much, and I'm getting that car instead of that car. And that's the actual decision that they're making. And then there's always different line items that play a role in putting together that transaction, but what matters to the customer is what's their payment delta and what's the car change, right? That's what matters. And so we've always viewed it as like the used car system is a system that doesn't manufacture products. It just helps consumers trade cars with each other and the consumer makes a single decision. And so the economics are sort of a single thing. And so what you want to do is you want to make sure you have access to all the different places where money could flow through because if you don't, you're susceptible to your competitors' marketing in ways where they make way less money in the line items that you have and they make more money in line items you don't have. But as long as you have coverage of all the different places where money can flow, you're kind of fine and you're basically indifferent about where the money shows up, and it's tremendously simplifying, I think. Because like, for example, our teams put together graphs, if you take the average of all of the public automotive franchise dealers over the last 25 years. And you graph their EBITDA margin over a 25-year period, what you basically see is it averages for the entire time. In 2008, it goes down to 3 when you control for goodwill write-downs because lower than that if you don't control for goodwill write-downs, but when you control for noncash goodwill write-downs, it goes down to 3. And basically, that's the story. It's been completely flat. But if we zoom into -- if you had like ChatGPT, go analyze all of the public automotive retailer conference calls for the last 25 years, and you said, what are the key themes, you get 100 themes. You get people talking about economics moving from the car to F&I and moving from here to there, and you'd have gas guzzlers and Hurricane Katrina in this recovery and that recovery. But then you back up and you look at the EBITDA margin, it's just completely flat. And to me, I think the biggest force, like we can talk about all these little things that go on all the line items. But the biggest force is that you have an enormous mature market with mature unit economics and you have tens of thousands of players with the exact same cost structure that don't have cash balances to absorb losses, and so at the end of the day, it's a pass-through of like a fair return on that capital. That's basically what it is. And so if you just back up to that level and you say, that's what this should be if we execute well. The only things that now move is what is our experience versus everyone else. What is our ability to get access to revenues compared to everyone else and what are our expenses compared to everyone else. For us to do that well, we have to be super dialed into all of the different line items. We have to be -- we have all kinds of interesting projects we're working on in inbound transport and outbound transport and vehicle data and pricing and finance and wholesale. But all of that reduces at the end of the day, too, can you do things on the revenue side better than everyone else on their cost side, better than everyone else and delivering experience if people like more. If you do that, you win. And the equation is basically what is the industry level profit, which is very flat. And then what are those 3 deltas? And so to us, the more that we can kind of reduce the conversation, I think the easier it is for us to talk about important things because I think all of us as people and as analytical people, we tend to look at the numbers that are moving, like whatever number is moving right now, we want to like look at and understand, and that's useful because you make sure that you're not missing anything, but also sometimes you can zoom in too far and you can miss the bigger picture. And the bigger picture is, I think, much simpler than people think, and I think very positive.

That's helpful. You gave yourself some flexibility in those margins in those -- in your letter that at some point, you want to give yourself margin flexibility to grow. Can you talk a little bit about where you think you might need to invest or add some slack to get that growth? Is it GPU? Is it SG&A? Where does price fall into that equation? Just help us through like maybe rank ordering some of the things you could do that might have the highest return on growth?

Yes. Well, first, what I would say is I think we've been on a path for a couple of years. We've been increasing our rate of growth and improving our economics continuously. And I think that like from where we sit today, we have another long list of very interesting projects that we're kicking off that we think have significant fundamental gains, and we don't think our offering has changed. And so as a result, we would expect -- our best expectation is that demand growth would continue in a way that is similar to the past. And I think to the extent all of that is right, there are exciting versions of the future that are very possible where we don't need that flexibility. What I also think is true, though, is that we have 1% of the market and we're currently around twice as profitable from an EBITDA margin perspective as the average outside of us automotive retailer. And so the most important thing we can do by a long way is displace players in this very large, very mature market with unit economics that we understand where the 3 deltas were very positive. And so in light of being 1% and having that be the most valuable thing and just recognizing the reality of like the world being a dynamic place, we want to make sure we preserve flexibility and that we communicate what are our priorities? Because like the world makes you trade off sometimes. So when we face those trade-offs, we will trade off within reasonable margins, we'll trade off towards growth. That's not like a signal for where we are today. That's what we think is smart to manage the business with a 5- to 10-year horizon.

Got it. I wanted to touch on the lending business briefly. Your gain on sale margins, the progress made over the last 18 months has been quite phenomenal. I mean there's always been some benefits on the gap between rates and APRs. But loss expectations are still high. What factors would you attribute to this improvement? Is it just residual pricing, more demand for the resets? Is the new partners coming on? Like help us like walk through that on the sustainability?

Well, I mean, first of all, we're a 12-year-old business that has been rapidly increasing in scale and many of the things that you do in finance get much better as you have more scale. So like just a very simple one is like your best credit score that you can build is definitely a function of the volume of data that you have. And so we're about to roll out our eighth credit scoring model. That's like a very simple fundamental game. Many other things that you do in finance, you structure your loans. You have to decide for any given customer, what is the minimum down payment, what is max monthly, what is max term? Those are all choices that are informed by data that you get better at over time. You have verification processes. The more verifications that you impose on a given customer, the lower the expected conversion is, but the better the expected performance is that's something that gets better over time. You can just like get strictly better by building better technology allows you to do more verification faster, but you also can make trade-offs in terms of what you're doing there. So all of these things are continually getting better. And there are teams that are working on all of these projects. And then I think we also -- I'm nowhere near objective on this particular point, but I think it's true. I think auto loans are a mispriced asset. And I know that's a very arrogant thing to say, and I believe that it is a mispriced asset. But I believe there is a growing body of evidence that those who buy them buy more of them disproportionately to those who buy other assets. And I think that, that allows them to become slightly less mispriced over time. And so I think that, that's been like a -- that's been a 10-year journey as well. And my personal take is, there remains some room in that journey, we'll see. But I think the team has done an awesome job there, and I think the vertical integration of the business lends itself to providing very simple customer experiences and capturing more of the economic gain that exists across the transaction. I think that you've seen that show up pretty continually. What we have like a little bit of a -- if you looked at our curve going way back in time, like going back since whatever the first years of data, we went public in '17. So I don't know if you provide -- I can't remember you provide 2 or 3 years of data, but if you go back to '14 or '15, you'd basically see a straight line up. In '21, you hit like an early peak because there's lots of things that are going on there that are good. We came down or kind of back up. But generally speaking, you've seen a pretty linear that looks a lot like our EBITDA margin. If you zoom into any of our line items, you'll generally see that improving line over time.

Yes. Sure. I have one more question on balance sheet cash flow and return to the audience. Say you get your targets in 5 years or 10 years or 15 years, like you're going to be generating tens of billions of cash flow over that period. What's going to be the use of that cash?

Can't we just like sit on. We're going to be generating tens of billions of cash flow and like maybe a high five for a second. I -- what I would say is I think it's -- I think that's a fun and stark reality versus the types of questions that we were getting a couple of years ago, which is nice. But I think it's likely true as long as we execute the way that we plan to. And I think there are many places we could put that cash for now. I think we're trying to just kind of reduce net debt, which is being reduced very, very rapidly. And I think that's a smart thing to do. And then I think to the extent we run out of good ideas, we'd be able to buy back stock. But I think, generally speaking, we've got plenty of ideas.

Would you consider just owning resets more using the balance sheet for the finance company, things like that or?

I wouldn't want to constrain us today, but we'll see. We'll try to do smart things.

Fair enough. Just want to open it up to the audience here if anyone has a question. Anyone here -- all right.

We got a question on...

We do. All right, there we go.

I think I can anticipate the answer. But I believe the company brought a new car dealer Stellantis. I'm just kind of curious what the strategy is around...

Wow come on, you can't anticipate the answer. Yes, sorry, it really is -- I don't mean to be evasive on that, but it is very early. And so we don't have much to share just yet, but we're testing and we're learning and as we have something to share, we'll share it. But forgive us for the nonanswer on that right.

And the other kind of a follow-up on the margin question. It does seem like the company has enormous leverage potential to go beyond that 13.5% margin, which I think you've somewhat alluded to. But can you talk about -- I mean, still you can go dramatically above that margin. So I guess how do you think about the brand, like for instance, if you were able to just offer strategically lower prices than the whole industry all of the time? Or -- can you just talk about how you're thinking through what to do with the excess margin that is likely on the come?

Yes. I think we're pretty excited about that. I mean I think -- the best reduction of that is, I think we said in the shareholder letter, like our goal is to become the way people buy cars, right? And I think to become the way you just need to be -- it needs to be a very simple conversation people can have with each other, right? Go to Carvana, they have the car you want, the deal is fair. It's super easy, car is great. If you don't like it, you can return it. And like if you say that confidently to your friends enough times, I at least don't understand why we're not selling a huge percentage of the cars over like a long period of time. And I think when you start from the place of having approximately double the EBITDA margins of the rest of the industry, and you start place of not having fully levered into your fixed cost and clearly having more opportunities in front of you, right? I think it's always hard to know exactly how much opportunity you have in front of you, but roughly speaking, if we convert like EBITDA margin to EBITDA dollars per unit, we improved by around $2,000 2 years ago and around $1,000 in the last year. If you can improve that much of that fast, there's more left, right? So we can argue about how much more is left, but there's more left. And I think that our growth -- I would say there's been like 3 periods of our company's history, there's 2013 through '21, which is pretty straight like full on sprint growth. There's '22 and '23, which is massive strategic change, total retrenchment, focus on just getting cash flow positive as soon as you possibly can. Then there's '24 and '25, which are growth again. And I think like when you see that growth, that growth is happening with our consumer economic offering quality being pretty similar. And so the offering that we've provided to customers paired with the speed at which they're telling each other the story of their Carvana experience has led to the company level growth and the cohort level growth that we've seen. And my hope and belief would be, to the extent we hold that constant, it would lead to a lot of growth in the future as well. I think to the extent we're able to go unlock the fundamental gains that we think we can unlock and pass a better offering on to customers that would be like incremental growth power beyond the growth power that we've seen for the last 12 years. And I think that, that's really exciting, too. So I mean, I think our eyes are really big. And I think we've got a lot of work to do, like there's a lot of work to do to unlock those fundamental gains. There's a ton of work to do to go actually scale the system and execute at the level that we need to. And we will definitely hit bumps along the way, but we're positioned unbelievably well. We've got a business model that scales really well. We've got a team that's been through like brutal times together, which I think demonstrates the ability to solve problems as they come and also suggests like a closeness that I think is also like a valuable thing as you're trying to manage through heavy growth. And I think we're starting in a great economic spot. And so I mean, to me, it's like -- I would have said at virtually every point in our company's life, except for maybe a day or two in '22 or '23, I would have said it's the best day of our life. We're back to where I think every day is basically the best day of our life, like I just think we're in a good spot.

Thank you. Any other questions? I just have a couple more here. I wanted to talk a little bit about AI and how you're starting to leverage that within the company. What internal data set do you think is more underutilized or undervalued today within the company and which could potentially become a differentiator long term for Carvana, given how much you collected over the last 10, 12 years?

I think the most valuable data set is the cross transaction data set. So I think like I would again go back to the thing we discussed earlier, which is a consumer makes the decision to buy a car, but to buy that car, like their currency is likely a car that they brought and a finance receivable and then they may also want to warranty. And I think the benefit of being a single vertically integrated system is all of that is available via API. Like all that data, we can just call and pull in and we compare it with our scheduler API and so you can have a customer that can say like, "I want a car for $400 a month that can be delivered on Thursday. I've got a family of 4, like, what's good for me." And you can answer that question. And you can answer that question in like a very informed way because you can access all of your previous data, so you can figure out what people are likely to want. And you also can call all those services to give someone a complete answer to that question that a retailer or a finance company or a third-party software company that's used to value your trade-in would not be able to do by themselves. So to me, I think there are many valuable data sets. We've got everything we do are vertically integrated. So we've got all of the transaction data. We've got all the clickstream data, we've got all the finance data. We've got the repeat customer data. We've got loan performance data, but I think pairing all that together into a single experience simply, I think is probably the most differentiated thing that we have. And AI massively accentuates your ability to do that.

That makes sense. Any questions? I had one question, a little off topic, just culture and philosophy related. Is there an internal debate, maybe 1 or 2 debates in the company that keeps resurfacing at the leadership level, but never gets fully resolved.

I mean I think the most recurrent debate has always been how fast should we grow and I think that generally speaking, I personally have been on the side of let's go faster. And I think, generally speaking, the operator has been on the side of let's make sure that we're moving at a pace that is kind of balanced and thoughtful and where we make sure that all the operations stay very tight. I think tension is valuable because I think you find better solutions when you argue with people you respect and then you have to push on each other's assumptions. And then I think pressure is valuable. I think that like one of the interesting things that all for sure, take away from '22 and '23 is we did better in a way that we could not have done on our own without the world telling us that we were stupid over and over again. Like I think that makes you better. And so I think putting pressure on yourself and finding ways to internally generate that pressure is important. So I think we also debate how do we do that? Because I think like we've had 2.5 years now where I think people stopped calling us as stupid and every once in a while, they call us smart. And I think that that's like much less helpful to productivity and so I think trying to make sure that we all internally like stay as hungry as we can is, I think, like another thing that we're putting energy into today. And I actually think it's hard. Like I think being successful for a long time is not normal for people. I think it's like -- it's much more normal to let success go to your head and be a little less effective as a result.

I think there are no further questions. I mean I think that's a good way to end. So thanks, Ernie.

Thanks everyone.

Thanks everyone for joining.